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Weighing grain crops against conservation

Grain prices are tempting farmers to plow up protected land, even as conservation subsidies shrink.

ZUMBROTA, MIN. — The Indian grass that Larry Thomforde planted 15 years ago is up to his chin now — tall gold spikes that sway in the sun as his dog, Gwynie, crashes through the field.

A year from now it might all be gold of another kind.

Thomforde, like thousands of other Minnesota farmers, is looking a painful decision square in the eye: cleaner water or the irresistible temptation of corn at stratospheric prices of $6 to $8 a bushel.

Next fall, Thomforde’s 50 acres of native grassland, idled under the federal Conservation Reserve Program (CRP), could go under the plow. Renting it out or planting corn would pay him much more than the government pays him to keep it in grasses.

“I don’t necessarily need the money,” said Thomforde, 75, who farms 240 acres near Zumbrota. “But my personality is such that I am not going to leave it in CRP if I am losing $200 per acre.”

Experts say 2012 is likely to be a tipping point for conservation across the Upper Midwest. Some 300,000 acres in Minnesota — one fifth of the land now set aside through the CRP — will be up for grabs as federal contracts come up for renewal.

In the following years, millions more acres in Minnesota, North and South Dakota — critical prairie and wetland habitat for a fourth of the nation’s migratory birds — may also fall to the plow as farmers choose between leaving it to nature or converting it to cash crops. Many predict that nature will be the loser.

These choices loom just as concern about Minnesota’s lakes and rivers is on the rise and the state is embarked on a decades-long plan to improve water quality from Lake Pepin to the Red River.

And yet all the financial incentives for farmers — who control half of Minnesota’s land — are poised to move in the opposite direction.

CRP is a case in point. The 25-year-old program pays farmers a nominal amount per acre to idle environmentally sensitive land — hilly slopes that erode quickly, stream banks, wildlife habitat. It’s by far the state’s leading land conservation program, paying farmers $100 million per year.

Keeping those acres out of production has reaped enormous environmental benefits. CRP has increased the number of ducks in the Prairie Pothole Region of Minnesota and the Dakotas by 2 million a year, according to the U.S. Department of Agriculture. Nationally, between 2004 and 2007, CRP lands retained 1.86 billion pounds of nitrogen, 420 million pounds of phosphorus and 1.8 billion tons of soil — much of which would have found its way into the Mississippi River and the so-called dead zone in the Gulf of Mexico. It also reduced carbon dioxide emissions by 200 million tons. And that was just four years.

But today, with soaring grain prices, most CRP payments don’t come close to competing with cash crops.

Yet even if corn prices fall again, the squeeze is likely to get worse. Facing intense pressure to trim the federal deficit, Congress is wrestling with a new farm bill that could reduce spending by $23 billion over the next decade. Every federal program designed to promote rural conservation is likely to take a hit. Just last week, leaders of the House and Senate Agriculture committees proposed reducing CRP from its current level of 32 million acres nationally to 25 million. Just a few years ago, it was 40 million.

So even if Thomforde and other farmers want to keep their land in CRP, many won’t get the chance.

Steve Taff, an economist at the University of Minnesota, said the financial equation is stark: As global demand for food, meat and energy rises, society increasingly values corn and other crops over clean water.

“We are not willing to pay for reduced water pollution, not that much,” he said. “Or reduced carbon. Or habitat.”

Stewardship grows costly

The Conservation Reserve Program was created in 1985, when corn prices were low. In fact, it was created partly to persuade farmers to cut production to reduce grain surpluses. Over time, it evolved more toward environmental goals. Each year the Agriculture Department sets a goal for land that meets certain environmental benchmarks; payments to farmers are tied to environmental benefits and local land rental rates.

In 2007, Minnesota had 1.8 million acres enrolled in CRP, among the most of any state, plus a few hundred thousand in other state and federal conservation programs — or about 8.6 percent of the state’s total agricultural land.

Thomforde described it as win for everyone. Farmers could reap a benefit from protecting the environment while setting aside what was often marginal land for crops.